How to maximize cash back with your credit card

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In a world where most people pay with plastic for convenience already, it makes sense to have a comprehensive credit card strategy in place. After all, you’ll want to make sure you have a plan to pay back purchases you charge to your card. Not only that, but you should strive to take advantage of any credit card benefits available to you, including any statement credits or usable perks you have.

Savvy cardholders will also work to maximize the cash back they earn throughout the year. After all, it only makes sense to rack up as much cash back as you can if you’re using a credit card to pay for bills and expenses in the first place.

How to maximize cash back earnings

But how do you come up with the best credit card strategy for your needs and your spending style? No matter what, part of your credit card points strategy should involve making sure you’re using the right rewards credit card for everything you buy.

The following tips can help you boost your rewards haul in the categories you spend the most in.

Everyday expenses

If you want to earn more rewards on everyday expenses, you should try to use your credit card for as many bills as you can. Not only should you cover all your recurring expenses with plastic, but see if you can use a credit card to pay for auto and homeowners insurance, daycare, utility bills and any other bills you can pay online or over the phone.

Citi® Double Cash Card

The Citi® Double Cash Card is a good option for everyday expenses since you get the chance to earn 2 percent back on everything you buy—1 percent when you make a purchase and another 1 percent when you pay it off. There’s no annual fee for this card, so you can keep it for the long haul.

Chase Freedom Unlimited®

The Chase Freedom Unlimited® also comes with no annual fee, yet you’ll earn a flat 1.5 percent back on all regular purchases. As an added bonus, you’ll earn 5 percent back on travel booked through Chase Ultimate Rewards, 5 percent on Lyft purchases (through March 2022) and 3 percent back on dining and drugstore purchases. You’ll also get a $200 cash bonus when you spend $500 within three months of account opening.

Dining

Dining is another category where you can really maximize rewards with the best credit card strategy in place. This is especially true if you’re someone who dines out often but also orders takeout and food delivery from time to time.

Capital One Savor Cash Rewards Credit Card

The Capital One Savor Cash Rewards Credit Card is a good option for dining since you earn 4 percent back on dining and entertainment, 2 percent back at grocery stores (excluding superstores like Walmart® and Target®) and 1 percent back on everything else. Through Jan. 31, 2022, you can also earn 8 percent back on purchases made through Vivid Seats. A $95 annual fee does apply, but you can earn an initial $300 cash bonus when you spend $3,000 within three months of account opening.

Capital One SavorOne Cash Rewards Credit Card

If you want to maximize cash back on dining but you don’t want to pay an annual fee, you can also consider the Capital One SavorOne Cash Rewards Credit Card. This card doesn’t charge an annual fee, but you’ll earn 3 percent back on dining and entertainment, 2 percent back at qualifying grocery stores and 1 percent back on other purchases. A smaller bonus of $200 is also available when you spend $500 on purchases within three months of account opening. You’ll even get an introductory 0 percent APR on purchases for 15 months, followed by a variable APR of 15.49 percent to 25.49 percent.

Gas and groceries

Also, look for ways to maximize rewards on gas and grocery purchases. After all, it’s likely you already spend a lot of money in these categories.

Fortunately, many of the best cash back credit cards on the market today offer lucrative rewards deals on gas and grocery spending.

Blue Cash Preferred® Card from American Express

The Blue Cash Preferred® Card from American Express lets cardholders earn the highest rate on groceries of any card on the market today. Once you sign up, you can earn 6 percent cash back on the first $6,000 you spend at U.S. supermarkets each year (then 1 percent), 6 percent back on select U.S. streaming services, 3 percent back on U.S. gas station purchases and on transit and 1 percent back on other purchases. You’ll also earn a $300 statement credit bonus when you spend $3,000 within six months of account opening for a $95 annual fee ($0 introductory annual fee for one year).

Blue Cash Everyday® Card from American Express

For lucrative rewards on groceries and gas without an annual fee, you should check out the Blue Cash Everyday® Card from American Express, as well. This card gives you 3 percent cash back on up to $6,000 spent at U.S. supermarkets each year (then 1 percent), 2 percent back at U.S. gas stations and select U.S. department stores and 1 percent back on other purchases. You also get the chance to earn $200 back after you spend $1,000 in purchases on your new card within the first 3 months.

Big purchases

If you want to maximize rewards and save money on big purchases, you should opt for a card that lets you earn cash back and secure 0 percent APR on purchases for a limited time. That way you can maximize cash back as you spend, but you get the chance to pay down your purchases without interest over time.

Capital One Quicksilver Cash Rewards Credit Card

When you sign up for the Capital One Quicksilver Cash Rewards Credit Card, you get the chance to enjoy rewards without interest for a limited time. You’ll earn a flat 1.5 percent back on all your spending, and you can also earn a $200 cash bonus when you spend $500 within three months of account opening. Purchases also qualify for an introductory 0 percent APR for 15 months, after which you’ll pay a variable APR of 15.49 percent to 25.49 percent. There’s no annual fee.

Chase Freedom Flex℠

If you want to secure 0 percent APR for a limited time but you also want to maximize cash back, the Chase Freedom Flex℠ is another option to explore. This card doesn’t charge an annual fee, but you’ll earn 5 percent cash back on up to $1,500 spent in activated bonus categories that change each quarter (then 1 percent back), 5 percent back on travel booked through Chase Ultimate Rewards, 5 percent back on Lyft rides through March 2022, 3 percent back on dining and drugstore purchases and 1 percent back on everything else. You can also qualify for $200 in bonus cash when you spend $500 within three months of account opening.

Flat rate vs. rotating bonus categories: Which is best?

As you look at the cash back credit cards we profiled above, you probably notice how variable credit card rewards schemes can be. Where some cards offer a flat rate of rewards for each dollar you spend, others offer different rewards amounts in different categories, or even rotating bonus categories that change every three months.

It’s hard to say whether flat-rate rewards or rotating categories are best, but you can consider picking up several different cash back credit cards if you prefer. If you have one card that offers a higher rate of rewards on all regular spending and you pair it with a card that offers a higher rate in categories that change each quarter, you may get the best of both worlds.

How to master rotating bonus categories

If you do decide to pick up a rewards credit card with rotating bonus categories, the main step you’ll need to take is staying on top of what the bonus categories are. Check in with your credit card every few months so you make sure you know which bonus categories apply during that timeline, and make sure you’re using the right card for the right purchases until the bonus spending threshold is reached.

Also, make sure you “activate” your credit cards bonus categories, which is required for the Chase Freedom Flex as well as the Discover it® Cash Back, which also offers 5 percent back (after activation) on up to $1,500 spent in quarterly rotating bonus categories, then 1 percent, and 1 percent back on other purchases. You can activate your card’s bonus rewards by logging into your online account management page, but you can also call the number on the back of your card to make this request.

With both cards, if you don’t activate your bonus rewards you’ll miss out.

The bottom line

Maximizing cash rewards means using your credit card for as many purchases as you can, but also having the ideal rewards card for your spending style. In the meantime, you’ll also want to avoid carrying a balance so you won’t have to pay interest on your purchases. With the average credit card APR currently over 16 percent, racking up rewards won’t make any sense if you also rack up long-term debt.

All information about the Capital One Savor Cash Rewards Credit Card has been collected independently by Bankrate.com and has not been reviewed or approved by the issuer.